The State Bank of Vietnam, the country’s central bank, said it will impose a 6 percent ceiling on dong denominated interest rates for non-term deposits and under 1 month terms to consolidate banking system and prevent liquidity risks.

The ceiling rate is included all kinds of promotion, the SBV stressed, adding that banks must openly quote interest rates as regulated, the central bank said in circular No 30/2011/TT-NHNN issued late on September 28.

The SBV holds dong deposits rate caps of 14 percent for all other terms, The new cap will be effective from October 1, for new deposits while the on-going ones will enjoy previous set interest rate until due day, the statement said. After the due day, all the deposit must applied 6 percent rate cap, it added.